Coca-Cola Amatil Limited (CCA) announced in October the execution of a Heads of Agreement with The Coca-Cola Company to accelerate CCA Indonesia’s (CCAI) growth strategy.
“Under the terms of the agreement, The Coca-Cola Company will invest US$500 million into CCAI, a subsidiary of CCA, in return for an ordinary equity ownership interest of 29.4%,” it said in the ASX Announcement.
The investment is set to support the accelerated expansion of CCAI’s production, warehousing and cold drink infrastructure to ensure long-term growth and success in this key market. The Agreement was conditional on CCA shareholder approval.
Yesterday, CCA announced that The Coca-Cola Company (TCCC) has received the applicable board approvals to invest US$500 million into CCAI.
“In exchange for the Proposed Investment, CCAI will issue TCCC with new shares equivalent to an ordinary equity ownership of 29.4% of the expanded share base of CCAI,” the company revealed in an ASX announcement.
Now, the Completion of the Proposed Investment, which is intended to accelerate CCAI’s growth strategy, is conditional only upon Indonesian regulatory approvals and CCA Non-associated Shareholder approval.
“This is an exciting development for both CCA and The Coca-Cola Company. With a population of more than 240 million and a fast-growing emerging middle class, Indonesia is a key growth market for CCA. In partnership with The Coca-Cola Company, we have developed a plan to support up weighted infrastructure and capability development to enable us to strengthen our market position for the long-term and generate returns above the cost of capital for CCAI,” CCA’s Group Managing Director, Alison Watkins said.
“This investment will allow us to capture the growth opportunity in one of the largest and most dynamic countries in the world as we enable our system to be even more responsive to consumer and customer needs,” President, Coca-Cola International, Ahmet Bozer said.
Execution of definitive documentation regarding the Proposed Investment is expected this week.
